How About Them Apples? Those Making $30K to Take Larger Tax Hit Than Those Making $500K

Middle-class workers will take a bigger hit to their income proportionately than those earning between $200,000 and $500,000 under the new fiscal cliff deal, according to the nonpartisan Tax Policy Center.

Earners in the latter group will pay an average 1.3 percent more – or an additional $2,711 – in taxes this year, while workers making between $30,000 and $200,000 will see their paychecks shrink by as much as 1.7 percent – or up to $1,784 – the D.C.-based think tank reported.

Overall, nearly 80 percent of households will pay more money to the federal government as a result of the fiscal cliff deal.

‘The economy needs a stimulus, but under the agreement, taxes will go up in 2013 relative to 2012 – not only on high-income households, as widely discussed, but also on every working man and woman in the country, via the end of the payroll tax cut,’ said William G. Gale, co-director of the Tax Policy Center.

‘For most households, the payroll tax takes a far bigger bite than the income tax does, and the payroll tax cut therefore – as [the Congressional Budget Office] and others have shown – was a more effective stimulus than income tax cuts were, because the payroll tax cuts hit lower in the income distribution and hence were more likely to be spent,’ he added.

Via Ace, we’re treated to this epic comedy gold from the miscreants at the Democratic Underground who just realized they’ve been had.

My paycheck just went down by an amount that I don’t feel comfortable with. I guarantee this decrease will hurt me more than the increase in income taxes will hurt those making over $400,000.

No shit, Sherlock. Today’s Friday, so a lot more of these idiots will be realizing the same thing when they see they pay checks. Read the comments. They’re so precious. Many of them actually expect Social Security to be solvent when they retire. The gullibility is off the charts.

Does anyone think this is a bad thing? SS tax is the closest thing we have to a flat tax, and Obambi wanted to start making it regressive. Whether it be Obambi or Romney, this was going to go back up…

My only regret was that the Republic Rats didn’t have the sense to turn this into a personal retirement account – like a 401K. That would have been smart. But those dunderheads aren’t known for being smart.

Secondly, it made the viability of SS more insecure. (a feature for many of those that praised it and lament it’s reinstatement)

It never took place for employers, the ones who could have really made better use of it. (which was the intent)

So nothing’s really changed, except we’ve returned to the reality of actually fully funding SS.

This is nothing compared to what’s coming though.

And the Republicans are just as responsible for the increase as anyone else. They’ve moaned and groaned about spending and having spending cuts but at every opportunity, they have shown they’re big government spenders also.

We won’t see any real fiscal sanity until the cards start to fall and payments can’t be made but by that time any efforts to stem the tide will be futile.

Welcome to the future that we made inevitable back in 2003 or earlier.

deadite – SS cannot be transformed into a 401k type program because all of the SS withholding collected from your paycheck today is being redistributed as benefit payments tomorrow. Any restructuring would kill the ponzi scheme as it exists at present. Besides, do you really want the federal government to mandate a defined contribution program for employees? Think Obamacare on steroids.

deadite – your ignorance of this issue is stupendous. First of all, the “payroll tax holiday” was a scam from the get-go. It funded Social Security, which is seeing a tremendous surge in benefit claims, both from retiring baby boomers and for supposed “disability” claims being made by those facing expiration of their unemployment benefits. So instead of putting money into a program that is in dire need of it, Odumbo played Santa once more and gave you a “holiday.”

Now of course, the program has been underfunded for the last two years. Oh, and since you’re so anxious to turn SS into a “401K type program,” I’m sure you’ll be right on board when Odumbo begins making noise about confiscating the funds in the 401K’s and killing the tax breaks. Because this underfunding and overburdening is going to provide him the perfect excuse for doing so. He and the Dumbocrats are salivating over those trillions in funds that they can’t get their slimey little hands on.

“My paycheck just went down by an amount that I don’t feel comfortable with. I guarantee this decrease will hurt me more than the increase in income taxes will hurt those making over $400,000.”

Obama began calling for more tax increases before the ink was dry on his signature on the “fiscal cliff” bill. I wonder if this effect on the middle class was deliberate, to make Obama’s argument that “the rich aren’t paying their ‘fair share'” stronger. It will make more people receptive to his push for more tax increases.